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Housing sector improving across metro markets

Growth in major metropolitan housing markets improved in March as the sector continues boosting its contribution to the nation's economic growth.

The housing sector’s nationwide average is now running at 88 percent of normal activity — based on current permit, price and employment data — up from 87 percent in February, according to the National Association of Home Builders/First American Leading Markets Index (LMI), released on Monday.

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Of the approximately 350 metro markets nationwide, 59 returned to or exceeded their last normal levels of economic and housing activity, which is a net gain of 11 metros year over year.

Meanwhile, 28 percent of metro areas saw their score rise this month, and 83 percent have shown an improvement over the past year.

"I think the big news here is that regions outside of the energy states continue to gain ground," said David Crowe, NAHB’s chief economist.

"It's a promising sign to see areas like Los Angeles and San Jose joining the top 10 largest MSAs showing a recovery,” according to NAHB’s chief economist David Crowe.

“We still expect 2014 to be a strong year for housing and to aid in the overall economic recovery. The job market continues to mend, and with that, we will see a steady release of pent up demand of buyers."

Baton Rouge, La., continues to top the list of major metro areas on the index, with a score of 1.42 — or 42 percent better than its last normal market level.

Other major metro areas at the top of the list include Honolulu; Oklahoma City; Austin, Texas, and Houston, as well as San Jose, Calif. and Harrisburg, Pa., all of whose index scores indicate that their market activity now exceeds previous norms.

"Things are getting slowly better overall," said NAHB Chairman Kevin Kelly, a homebuilder and developer from Wilmington, Del. "And with the housing market now entering the spring buying season, the fact that the nation's economy is headed in the right direction is a very promising sign."

Smaller metro areas showing recovery continue to be dominated by the energy boom in the country's mid-section. Odessa and Midland, Texas, markets are now at double their strength prior to the recession. Also at the top of the list of smaller metros are Bismarck, N.D.; Casper, Wyo.; and Grand Forks, N.D., respectively.